US defense contractor L3Harris Technologies Inc on Sunday said it would purchase Aerojet Rocketdyne Holdings Inc in a US$4.7 billion all-cash transaction, as it looks to tap into rising demand for missiles amid the Ukraine conflict.
The offer price of US$58 per share represents a premium of 6.5 percent to Aerojet’s close on Friday.
The deal, which is expected to be completed next year, would add to L3Harris’ Space & Airborne Systems unit, which makes electronic warfare equipment and avionics sensors.
Photo: AP
Reuters last month reported that L3Harris, formed by the merger of L3 Technologies and Harris Corp in 2019, was among the companies vying to buy Aerojet, which put itself up for sale after antitrust regulators blocked a merger with Lockheed Martin Corp earlier this year.
The US has assisted Ukraine with billions of US dollars in military aid, including missiles and air defense systems, driving up demand for missiles as allies also seek to boost their defenses.
Aerojet develops and manufactures liquid and solid rocket propulsion and hypersonic engines for space, defense, civil and commercial applications.
The market for rockets has also received an incentive from NASA, one of Aerojet’s main customers, which is pursuing moon and deep space missions with renewed vigor.
Aerojet makes the RS-25 engines for NASA’s launch vehicle, as well as the RL10 engines that power launch vehicles made by United Launch Alliance, a joint venture between Boeing Co and Lockheed Martin.
L3Harris, which has been investing in the space and cyberindustries, is looking to solidify its position among top aerospace and defense firms as one of the leading contractors to the Pentagon.
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